The Victorian era was, of course, the era in which Queen Victoria ascended to the crown in England. Victorian literature in general was darker, heavier, and more concerned with social ills than its idealistic predecessor, Romanticism, and paved the way for the stark, unflinching writing of the Modernist movement.
Alfred Lord Tennyson, the poet who wrote "The Lady of Shalott" was Queen Victoria's favorite poet, and remains one of the best known poets of the Victorian era. The poem opens with images of a beautiful, bucolic countryside marked by the forbidding walls and towers of Camelot. The Lady of Shalott is slowly revealed to be a prisoner in the tower, unable to look at the outside world directly. Rather, she must look through a mirror. She weaves what she sees into a tapestry, and is seemingly happy in her prison. This combination of the lovely dream juxtaposed with difficult reality is characteristic of Victorian poetry.
When the Lady's mirror is shattered, when she is no longer able to ignore the real world outside her window, she dies. The Victorian era was a time of great social and cultural reform, when people were no longer able to ignore the troubles of others. It is possible that Tennyson was criticizing those who continued to live as if nothing was wrong.
If there were no other reasons, Tennyson's "The Lady of Shalott" would be considered Victorian because it was written by the man considered to be the poetic voice of the Victorian age, the man appointed poet laureate of England, and the man made a baron by Queen Victoria. The poem, in itself, though, is clearly from an early Victorian tradition.
Early Victorian poetry followed in the tradition of Romantic poetry. "The Lady of Shalott" is of this tradition. The poem looks to the past, particularly to medieval tales of Arthur and Camelot. The Romantics romanticized the medieval period, and sought to imitate it. Tennyson uses the castle, Camelot, as a back drop for his poem. In the Victorian world of intellectual turmoil (think Darwin and the crisis of faith), and ethical turmoil (think of the negative aspects of the industrial revolution), Tennyson looks to the past.
The Lady of the poem, herself, suffers a crisis of faith, so to speak, when she sees Lancelot. Her world of images and art is no longer enough, and she breaks free to the outer world, regardless of the consequence:
"I am half-sick of shadows,..."
she says before seeing Lancelot, and after, she looks to Camelot, bringing about her destruction:
Out flew the web and floated wide;
The mirror cracked from side to side;
"The curse is come upon me," cried
The Lady of Shalott.
Tennyson seems to be treating the nature of creativity and of artists, artistic subjectivity, and the natural tendency of artists to separate themselves from reality. This separation doesn't work out so well for the Lady.
Incidentally, Loreena McKennit has put music to the poem and recorded it. It's fantastic!